Incident: The company released its 2020 semi-annual report. From January to June 2020, the company achieved operating income of 90,95082 million yuan, an increase of 41.09% over the same period last year; net profit attributable to shareholders of listed companies was 49,2457 million yuan, a decrease of 34.73% over the same period last year; basic earnings per share 0.05 yuan, a decrease of 39.76% over the same period last year.
Military electronics is growing rapidly, and we are optimistic about the annual performance. During the reporting period, the company's military electronics business continued to maintain a high growth rate. Chengdu Yaguang Electronics achieved operating income of 68,00951 million yuan, an increase of 67.95% over the previous year; net profit was 100.6845 million yuan (of which the shared equity incentive cost was 23.4377 million yuan), not taking into account the increase in equity incentive costs of 53.88% over last year.
The company completed the award of 47.95 million share options to 132 incentive recipients in March 2020, amortized the equity incentive cost of 408.668 million yuan and included current management expenses, resulting in a 34.73% year-on-year decrease in net profit attributable to shareholders of listed companies in the first half of the year. If the impact of equity incentive costs is not taken into account, net profit attributable to shareholders of listed companies was 90.1124 million yuan, an increase of 19.43% over the same period last year, so we are optimistic about the company's annual performance.
The boating business continues to lose money, and asset consolidation is progressing in an orderly manner. During the reporting period, the company's boating business was greatly affected by the COVID-19 pandemic, and there were many delays in order delivery. From January to June 2020, the boat business achieved revenue of 189.3047 million yuan, a decrease of 10.66% over the previous year; net profit was -393.9983 million yuan (including the sharing of equity incentive costs of 17.4291 million yuan), not taking into account the 198.58% year-on-year decrease in equity incentive costs. According to the announcement, Yaguang Technology plans to transfer the relevant assets and liabilities of the parent company to Yiyang CNOOC Shipbuilding Co., Ltd., a wholly-owned subsidiary, and eventually the company's boat business falls under Zhuhai Sunbird Yacht Manufacturing Co., Ltd. We believe that the integration of boat assets is conducive to the classification operation and centralized management of the company's various business segments, further improving and optimizing the existing business structure, making it easier for the boating business as a whole to introduce strategic investors and carry out related capital operations, which has a positive effect on the company's long-term development.
Profit forecast and investment rating: Excluding equity incentive costs, the company's net profit for 2020-2022 is estimated to be 380 million yuan, 527 million yuan, 697 million yuan, EPS is 0.38 yuan, 0.52 yuan, 0.69 yuan, and corresponding PE is 49 times, 36 times, and 27 times, maintaining the “buy” rating.
